KUALA LUMPUR: Using the Employees Provident Fund (EPF) savings to pay off credit card debts or loan sharks is against the pension fund’s principle of providing retirement savings for its members, the Dewan Rakyat was told.
The Ministry of Finance (MoF) said the withdrawal of EPF savings was only allowed for the purpose relating to retirement and for investment to add value to the savings.
“Allowing members to withdraw their EPF savings to settle off debts will only defeat EPF’s purpose in ensuring members have sufficient savings to cover their commitments, post-retirement,” the MoF said in a written reply to a question from Kasthuriraani Patto (DAP-Batu Kawan) on a proposal for such withdrawal.
Such withdrawal would deplete one’s EPF savings and affect the depositor’s retirement plans, the MoF said.
To another question from Kasthuriraani, the MoF said based on the Department of Insolvency data, 119,656 Malaysians were declared bankrupt from 2010 to 2015.
The data also showed that the number of indebted Malaysians rose from 18,119 in 2010 to 22,351 in 2014 before easing to 18,457 in 2015.